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Bipulcustomer Perception Towards Internet Banking 120419125012 Phpapp01
Bipulcustomer Perception Towards Internet Banking 120419125012 Phpapp01
TABLES
PAGE NO.
TABLE1..15
TABLE2..15
TABLE3..17
TABLE4..18
TABLE5. 19
TABLE6. 20
TABLE7..22
TABLE8..27
TABLE9..27
FIGURE
FIGURE1.14
FIGURE2.16
FIGURE3.17
FIGURE4.18
FIGURE5.20
FIGURE6.21
FIGURE7.22
FIGURE8.26
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INTRODUCTION
A Case study to analyse the effects of consumer risk perception while
purchasing services through internet- A case study of Banking Sector.
What is bank?
A banker or bank is a financial institution whose primary activity is to act as a payment
agent for customers and to borrow and lend money. It is an institution for receiving,
keeping, and lending money.
What is online Banking?
Online banking (or Internet banking) allows customers to conduct financial transactions
on a secure website operated by their retail or virtual bank, credit union.
Need for internet banking: One has to approach the branch in person, to withdraw cash
or deposit a cheque or request a statement of accounts. In true Internet banking, any
inquiry or transaction is processed online without any reference to the branch (anywhere
banking) at any time. Providing Internet banking is increasingly becoming a "need to
have" than a "nice to have" service. The net banking, thus, now is more of a norm rather
than an exception in many developed countries due to the fact that it is the cheapest way
of providing banking services
Banks have traditionally been in the forefront of harnessing technology to improve their
products, services and efficiency. They have, over a long time, been using electronic and
telecommunication networks for delivering a wide range of value added products and
services. The delivery channels include direct dial up connections, private networks,
public networks etc and the devices include telephone, Personal Computers including the
Automated Teller Machines, etc. With the popularity of PCs, easy access to Internet and
World Wide Web (WWW), Internet is increasingly used by banks as a channel for
receiving instructions and delivering their products and services to their customers. This
form of banking is generally referred to as Internet Banking, although the range of
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products and services offered by different banks vary widely both in their content and
sophistication.
Indias banking sector is growing at a fast pace. India has become one of the most
preferred banking destinations in the world. The reasons are numerous: the economy is
growing at a rate of 8%, Bank credit is growing at 30% per annum and there is an everexpanding middle class of between 250 and 300 million people (larger than the
population of the US) in need of financial services. All this enables double-digit returns
on most asset classes which is not so in a majority of other countries. Foreign banks in
India achieving a return on assets (ROA) of 3%, their keen interest in expanding their
businesses is understandable even more so when compared with the measly 1% average
ROA for the Top 1000 banks in the world.
From the perspective of banking products and services being offered through Internet,
Internet banking is nothing more than traditional banking services delivered through an
electronic communication backbone, viz, Internet. But, in the process it has thrown open
issues which have ramifications beyond what a new delivery channel would normally
envisage and, hence, has compelled regulators world over to take note of this emerging
channel. Some of the distinctive features of i-banking are:
1. It removes the traditional geographical barriers as it could reach out to customers of
different countries / legal jurisdiction. This has raised the question of jurisdiction of law /
supervisory system to which such transactions should be subjected,
2. It has added a new dimension to different kinds of risks traditionally associated with
banking, heightening some of them and throwing new risk control challenges,
3. Security of banking transactions, validity of electronic contract, customers privacy,
etc., which have all along been concerns of both bankers and supervisors have assumed
different dimensions given that Internet is a public domain, not subject to control by any
single authority or group of users,
4. It poses a strategic risk of loss of business to those banks who do not respond in time,
to this new technology, being the efficient and cost effective delivery mechanism of
banking services.
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5. A new form of competition has emerged both from the existing players and new
players of the market who are not strictly banks.
Why this research: An analysis of the differences in risk perceptions between bank
customers using Internet Banking and those not using Internet Banking was done and it
showed that risk perceptions in terms of financial, psychological and safety risks among
customer not using the internet was more meaningful than those using internet banking.
Customers not preferring to use internet banking thought that they would be swindled
when using this service, and therefore, are particularly careful about high risk expectation
during money transfers from and between accounts. Only 37% of Indian Internet users
come from Top 10 cities i.e. Mumbai, Bangalore, Delhi, Calcutta, Chennai, Pune,
Hyderabad, Ahmedabad, Surat and Nagpur. As per IAMAI and I-cube, the number of
active Internet user (i.e. ones who logon to Internet atleast once a month) is now 32
million and numbers who have used Internet atleast once stands at 46 million. Maximum
of the person who are going on for internet banking lies in the age bracket of 26-35. but
the rise in the age the level of users become low.
Approximately 17% of female use internet banking. This a matter of concern for a banks
what are the causes why this is happening. Although many major banks have started
offering i-banking services, the slow pace will continue until the critical mass is achieved
for PC, internet connections and telephones. However, the upsurge of IT professionals
with growing demands is pressuring the government and bureaucracy in the country to
support and develop new initiatives for a faster spread of i-banking. But then to there is a
fear in mind of customer using internet as a medium for the banking transaction.
Private and foreign banks are trying to turn more and more customer towards the
usage if internet for the banking transaction. This study is basically to know the relation
of various independent variables on the customer usage of internet for banking.
The remarkable development of the Internet has drastically expanded the shopping space
for a number of consumers. According to a Fast Company survey, Internet buyers as a
percentage of all Internet users grew from just 19 percent in 2001 to 71 percent in 2010.
Not only has Internet shopping created a new marketing provider that meets consumer
needs and wants, but it has changed the consumer shopping culture with "click" shopping
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and ease of information searches for product or service buying. Nevertheless, unlike
traditional commerce, e-commerce involves various risks (e.g., product performance,
credit card information) that consumers perceive and thus consumers are engaging in risk
reduction behaviors based on a wealth of information.
Many consumers today, regardless of their intention, are exposed to a great amount of
information through both off-line and on-line advertising. Providing effective information
in online environments can reduce consumer search costs and lead to consumers making
optimal purchasing decision. The several information resources - particularly brand,
word-of-mouth, and customized information-act as guides that can reduce risk and
facilitate consumer choice. In particular, the information in new purchase situations is far
more important for first-time customers than for existing customers.
Despite the assumption that pre-purchase information can lower a consumer's risk,
existing research on consumer behavior on the Internet has focused on Internet
purchasing or on information searching through the Internet. pre-purchase information is
a crucial tool because it reduces consumer risk, increases brand comprehension, and helps
consumer make a brand choice.
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RATIONAL OF STUDY
Risk perception and consumer stress are two important factors that firms have to take into
consideration since they are important parts of consumer behavior. Although risk
perception concept has been analyzed in various studies, consumer stress and
relationships between risk perception and consumer stress have not been researched in
marketing literature. To illuminate the issue, present study scrutinizes consumer risk
perception, stress and relationships between these two terms. To reach this target, initial
data were collected by survey forms which are designed to measure risk perception and
stress level of banking consumers . Moreover collected data were analyzed by statistical
methods namely correlation analysis and t-tests. As a result, time risk perception,
physical risk perception and psychological risk perception determined as factors which
increase consumer stress meaningfully in banking sector
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LITERATURE REVIEW
In India still there is lack of users for internet as a medium for banking purpose, but the
banking system are upgrading and bringing many electronic banking medium for
customers so that banking can be made more convenient.
Joseph et al. (1999) investigated the influence of internet on the delivery of banking
services. They found six underlying dimensions of e-banking service quality such as
convenience and accuracy, feedback and complaint management, efficiency, queue
management, accessibility and customization. Jun and Cai (2001) identified 17 service
quality dimensions of i-banking service quality. These are reliability, responsiveness,
competence, courtesy, credibility, access, communication, understanding the customer,
collaboration, continuous improvement, content, accuracy, ease of use, timeliness,
aesthetics, security and divers features. They also suggested that some dimensions such
as responsiveness, reliability and access are critical for both traditional and internet
banks. Jayawardhena (2004) transforms the original SERVQUAL scale to the internet
context and develops a battery of 21 items to assess service quality in e-banking.
From the provider perspective, there are target quality and delivered quality. The focus of
process- or supply-led quality definition is rather internal than external, and it is defined
as conformance to requirements. It lays emphasis on the importance of the management
and the supply-side quality, and there is an important role of the process in determining
the quality of outcome (Ghobadian, 1994). Achieving the quality of conformance
between the planned (target) quality level and the real quality delivered to customers
depends on the service quality management system in an organization.
IAMAI report on online banking 2006. 43% of online banking user havent started
online financial transaction because of security reasons, 39% havent started because they
prefer face to face, 22% havent started because they dont know how to use, for 10%
sites are not user friendly and for 2% banks are not providing the facility of internet
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banking. According to research 68% of the customers can not say that when they will be
starting the financial transactions through internet.
Maximum numbers of online banking users are male and maximum of them are in age
the group of 25-35. Numbers of female users are very less i.e. 17% only. More than 60%
of the people who are having account with have accounts in 3-4 banks.
Only 37% of Indian Internet users come from Top 10 cities i.e. Mumbai, Bangalore,
Delhi, Calcutta, Chennai, Pune, Hyderabad, Ahmedabad, Surat and Nagpur. Another day
and another number. As per IAMAI and I-cube, the number of active Internet user (i.e.
ones who logon to Internet atleast once a month) is now 32 million and numbers who
have used Internet atleast once stands at 46 million.
The Indian Internet Banking Journey In 2001, a Reserve Bank of India survey
revealed that of 46 major banks operating in India, around 50% were either offering
Internet banking services at various levels or planned to in the near future. According to a
research report,( India Research, Kotak Securities, May 2000.) while in 2001, India's
Internet user base was an estimated 9 lakh; it was expected to reach 90 lakh by 2003.
Also, while only 1% of these Internet users utilized the Internet banking services in 1998,
the Internet banking user base increased to 16.7% by mid- 2000.
Meuter et al. (2000) have identified critical incidents of customer satisfaction and
dissatisfaction with technology-based service encounters. Given that business-to-business
transactions are the fastest growing segment of technology-driven services (Hof, 1999);
Meuter and his colleagues (2000) suggested investigating what drives business customer
satisfaction or dissatisfaction with technologydriven services. According to Gnroos
(1982), customers distinguish the quality of customer interactions that take place during
service delivery (functional quality) and the quality of the outcome the customer receives
in the service encounter (technical quality).
Customers perceive the quality of services of Internet banking based on the performance
of online delivery systems not on the processes in which the delivered service is
developed and produced. Because customers perceive Internet banking service quality
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time
risk,
finacial
risk,
performance
risk,
psychological
risk
and
RESEARCH OBJECTIVE
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Findings indicate that missing information can affect buyers' tastes and purchase
decisions made subsequently. Perhaps the findings of the current project might offer
greater insight (e.g., correlation between consumer perceptions and pre-purchase
information) to e-marketers and e-marketing researchers about the role of pre-purchase
information in management and e-commerce.
(1) To Uncertainty as to buying goals.
(2) To several purchases (product, brand, model, etc.) best matches the buying goals.
(3) To Possible adverse consequences if the purchase is made (or not made).
RESEARCH METHODOLOGY
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RESEARCH TYPE
We use descriptive research and exploratory research design in our studies. Descriptive
research is also called Statistical Research. The main goal of this type of research is to
describe the data and characteristics about what is being studied. The idea behind this
type of research is to study frequencies, averages, and other statistical calculations.
Although this research is highly accurate, it does not gather the causes behind a situation.
Descriptive research is used to obtain information concerning the current status of the
phenomena to describe "what exists" with respect to variables or conditions in a situation.
Here we also tried to find out the main cause why there is perceptual blocking of the
Indian customers towards internet banking. The methods involved range from the survey
which describes the status quo, the correlation study which investigates the relationship
between variables, to developmental studies which seek to determine changes over time.
procedure
Collection of information
Analysis of information
DATA COLLECTION
Primary Data: Structured Questionnaire
Secondary Data: Online Database, Journals, Survey
Alternative Hypothesis
(H1): there is a positive impact of risk perception.
SAMPLING
We have used convenience sampling technique. It is also called haphazard or accidental
sampling. Members of the population are chosen based on their relative ease of access.
To sample friends, co-workers, or shoppers at a single mall, are all examples of
convenience sampling. Sometimes called grab or opportunity sampling, this is the
method of choosing items arbitrarily and in an unstructured manner from the frame.
Though almost impossible to treat rigorously, it is the method most commonly employed
in many practical situations.
TOOLS
Statistical : SPSS
Techniques : MDS and Multiple Regression
Q1)
age
18-25
26-35
36-45
46-60
61-+
own a internet
27
51
20
8
1
Table 1
Figure1
InterpretationFrom the above interpretation we can say that age group between 18-25 own
a internet of 27%while % who dont own an internet is 3%, similarly %
between 26-35 own an internet of 51% while 1 %dont own internet, 36-45
own an internet of 20% while 2%dont own, 46-60 own 8%internet while
4% dont own, 61and above own 1 %internet, 3%dont own. Finally we can
see that age group 26-35 own maximum % of internet.
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age
18-25
26-35
36-45
46-60
61-+
A) 1 to 6 months
2
0
3
2
3
A) 6 to 12 months
12
15
0
8
0
Table 2
Figure2
Interpretation
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From the above interpretation we can say that all the younger have been
using internet since last one year but age group between 36-45, 46-60and 61
and above have started using internet in recent . finally we can the age
group between 26-35 are the maximum users of the internet .
<1
11
4
2
4
5
1 to 3
14
1
3
8
0
3to8
10
3
2
2
0
8to12
3
8
4
2
0
12+
2
26
5
1
1
Table3
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Figure3
Interpretation
From the above inerpretation we can say that in comparison to all the above
age groups maximum no. of time that is being visited to the bank is of age
group between 26-35 thats is around 12 times in a month .
Q4) the main reason that you typically visit your bank branch (please choose the single
most important reason)?
age
a)
to make a deposit
b)
c)
d)
to withdraw cash
e)
other
deposit
Advice
balance
withdrawal
Others
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18-25
26-35
36-45
46-60
61-+
10
10
3
4
1
8
4
0
4
0
13
7
4
5
2
7
17
7
4
3
2
4
2
0
0
Table 4
Figure4
Interpretation
From the above interpretation we can say that the reason for visiting bank
maximum no. of time is basically is for the cash withdrawl that to is done by
the agr group between 26-35 that is of 17.
ATM
Online banking
Telephone banking
Mobile banking
SMS banking
age
18-25
26-35
36-45
46-60
61-+
Atm
20
10
2
14
5
online
21
29
16
25
2
telephone
12
14
2
2
2
Mobile
15
18
15
2
2
Sms
25
30
12
14
5
Table 5
Figure5
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Interpretation
From the above itnerpretation we can say that all the above age gropus says
that the mostly all the facilites is provided by their banks wheteher it be atm
online, telephone , mobile expcept to the person who belong to the age group
of 61 and above .
Q6) what banking services do you use which your Internet bank offers? (Please check all
you are currently using)
Inter-account transfers
Others
20 | P a g e
Table 6
Figure6
Interpretation
From the above interpreatation we can that the perosn use internet bank
offers basically for seeking product and rate information and seconly for
checking balance and then they use for to download loan information ,then
to dowmload personal bank transaction activities .
Q7) what was the single most important reason that you chose this particular bank as
your Internet bank? (Please choose one)
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Others
Table 7
Figure7
Interpretation
From the above interpretation we can say that the reason for choosing
particular bank for internet bank account is beacause of the excellent
services offered by the bank and second most improtant reason is that of
brand name of the bank .
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MDS
After filling up the 63 column and 120 rows of SPSS data we get the table of responses of
120 respondents perception about our 6 brands and their 9 attributes. We calculate the
weighted mean of every column and finally we get the 6*10 matrix form of our
weighted mean MDS data, which would be input to SPSS for final MDS output. The
6*10 matrix is given below-
Parameters
hsbc
yesbank
Accessib
Account
Bank ser
Convenie
design
Encourag
Location
Training
user fri
.000
2.172
.000
2.393
.932
.000
1.511
1.407
1.937
.000
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1.786
1.163
.954
1.361
.000
2.061
2.264
2.475
1.540
2.146
6
6
.000
The index of fit or R-square and stress should be measured. Thus R-square indicates
goodness of fit, whether stress value represents badness of fit. So for any research higher
value of R-square and lower value of Stress is expected. The high R-square value
represents MDS model is well fitted with the given problem. In our case,
Stress = .01817
RSQ = .99785
S-stress
Improvement
.02311
.01992
.00319
.01838
.00154
.01698
.00139
.01564
.00134
.01434
.00130
.01327
.00107
.01266
.00061
.001000
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For
Stress
matrix
.01817
RSQ =
.99785
Stimulus Coordinates
Dimension
Stimulus
Stimulus
Number
Name
detuch
1.1537
1.4040
hdfc
-1.0363
-.3486
CITIBANK
-1.5704
-.1294
ICICI
.5452
-.0590
HSBC
-.7060
.3541
yesbank
1.6138
-1.2210
.000
2.800
.000
3.126
.577
.000
1.590
1.590
2.126
1
5
.000
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D
e
r
i
v
d
S
t
i
m
u
l
s
C
o
n
f
i
g
u
r
a
t
i
o
n
.1
1
5
.0
5
2.126
.890
.890
1.318
.000
2.665
2.800
3.366
1.590
2.800
.000
Dim
ensio2
.-0
0
5
.-1
0
.-1
5
..0
5-2-1D
0
1
2
im
e
n
s
io
n
1
Figure8
to positive response but here we can see that there is some areas where the bank has to
work on to improve.
For your choice of an Internet bank, please indicate how much each of the following
factors (were) are important for you:
Valid
Missing
Convenience
120
0
Curiosity
120
0
Rates
120
0
Safe
120
0
Charge
120
0
transaction
120
0
shopping
120
0
3.1083
2.9333
2.9667
2.9833
2.7083
2.9250
2.5083
Mean
Table 8
BY THIS WE CAME TO KNOW THAT PEOPLE USING INTERNET BECAUSE OF
CONVINENCE ARE MOE AND LESS BECAUSE O SHOPPING.
The main reasons that you have not opened an Internet bank account yet? (Check all that
apply)
Statistics
N
Mean
Valid
Missing
NEVERHR
SECURIT
30
0
3.0000
30
0
3.3333
TIME
30
0
2.6000
DNTWNT
30
0
3.1333
CHECKFIRS
NOTAVALIAB
30
0
2.5000
30
0
2.9333
OTHERS
30
0
2.6000
Table 9
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Security is the main reason why people are not opening the internet bank acounts where
as the second highest goes to they dont want to try new thing.
28 | P a g e
Provide a platform from where the customers can access different accounts at
single time without extra charge.
The research reported here has admitted limitations. Because the study was focused on
consumers' perceived information about Internet sites, the findings may not be
generalizable to the many types of e-stores in e-commerce. Also, consumers often carry
out information searches for themselves to supplement pre-purchase information search
such as brand reputation, word-of-mouth, and customized information. In particular, we
overlooked other sources regarding risk perceptions: namely, communities, bulletin
boards, 3-D advertisings, and so forth. Many customers may be interested in them and
join voluntarily. Through these experiences, customers can perceive risks regarding the
purchase of products or services. Finally, interaction impacts that can influence consumer
perceptions such as satisfaction, trust, and loyalty are insufficient because they can
significantly affect consumer perceived risk. Nevertheless, despite its limitations, this
empirical research has shown that consumer perceived risk is closely affected by
consumer pre-purchase information associated with product purchase through ecommerce.
Future research should focus on how interaction between pre-purchase information and
post-purchase information influences consumer purchase decisions because postpurchase information processing based on the purchase performance may differ
considerably from pre-purchase information processing. Theoretically, having found
differences in the pre- and post-purchase information processing stages, this provides
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BIBLOGRAPHY
BOOKS
1) Marketing research by BERRY G.C ., seventh edition
2) Marketing Research by Malhotra N.K. , fifth edition
SITES
(http://www.icmrindia.org/free%20resources/casestudies/banking1.htm#b1
www.hdfcbank.com/
www.hsbc.co.in/
www.icicibank.com/
www.yesbank.in/
www.db.com
en.wikipedia.org/wiki/Perceptual_mapping
www.rocw.raifoundation.org/fashion/BAfashion-mktg/brandpositioning/lecturenotes/lecture-04.pd
en.wikipedia.org/wiki/Multidimensional_scaling
REFRENCES
1. Khan, M.S., Mahapatra, S.S. and Sreekumar (2009) Service quality evaluation in
internet banking: an empirical study in India, Int. J. Indian Culture and Business
Management, Vol. 2, No. 1, pp.3046.
2. IAMAI report on online banking 2006
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3. The Indian Internet Banking Journey - Nachiket Mor, Head of ICICI's Treasury,
in March 2000.
1. The Impact Of Internet Banking Service Quality On Business Customer
Commitment
QUESTIONNAIRE
Name ..
Age 18-25__ , 26-35__, 36-45__, 46-60__, 60 +____
Gender -
MALE
FEMALE
Occupation .
2) Are you user of internet?
a) Yes
b) No
3) Since how long you are using internet?
a) less then a month
b) 1 to 6 months
c) 6 to 12 months
d) More than a year
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a) Less than 1
b) 1 to 3 times
c) 3 to 8 times
d) 8 to 12 times
e) over 12 times
5) The main reason that you typically visit your bank branch (please choose the single
most important reason)?
a. to make a deposit
b. to get advice for investment options
c. to inquire about a balance
d. to withdraw cash
e. other
d) Mobile banking
e) SMS banking
Better rates______________
f)
33 | P a g e
Q1- What banking services do you use which your Internet bank offers? (Please check all
you are currently using)
a) Seeking product and rate information
b) Calculate loan payment information
c) Download loan applications
d) Download personal bank transaction activity.
e) Check balances on-line
f) Apply for consumer loans or credit cards online
g) Inter-account transfers
h) On-line bill payments
i) Others
Q 2-What was the single most important reason that you chose this particular bank as
your Internet bank? (please choose one)
a) I have a traditional bank account with the same bank
b) The brand name of the bank
c) The excellent service offered by this bank
d) Others
Q 3- In addition to your Internet bank account, do you also have a traditional bank
account?
a) Yes
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b) No
scale
1 - Very poor
2
3
4
5
Poor
Good
Average
Best
PARAMETERS /
BRANDS
Bank service
HDFC
DEUTSCHE
CITIBANK
ICICI
HSBC
YES
BANK
Account security
Accessibility
Convenience
Training to use
banking services
Encourage
customer to use ebanking
Location
Customer Relation
Management
USER
FRIENDLINESS
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Thank You
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